Australia’s major superannuation funds have posted positive returns for the seventh consecutive year, according to Chant West, although this year’s results are lower than the previous three years.
In a note to investors, Chant West said the average median growth fund saw returns of 3 per cent, significantly below the last three years, which included a high of 15.6 per cent for 2012/13 and a low of 9.8 per cent in 2014-15.
Chant West director Warren Chant said the reduced returns shouldn’t be a concern to members however, as the cumulative return since the GFC sits at around 80 per cent, or 8.8 per cent per annum.
“That’s about 6.5% above the annual rate of inflation, so it’s comfortably ahead of the typical longer-term return objective for these funds which is to beat inflation by between 3% and 4% annually,” he said.
Mr Chant said this year’s positive returns in the face of “a very uncertain” global economy were indicative of diversification at play”.
“These funds are so well diversified across a wide range of growth and defensive asset sectors, including alternative and unlisted assets, they can successfully smooth out returns when listed share markets are struggling,” he said.